Buying your first home is an exciting, emotional roller coaster. As we discussed over the past few weeks, we’re going to have plenty of town homes and condo suites available here at Lakebreeze, both of which are excellent starter options for those who are making their first purchase. If you’re a first time buyer, you’ll want to get a handle on the various benefits that you have available to you – because really, you only get one chance to use them. Aside from helping you to cover the down payment, which is often the biggest barrier, they can also help to offset the (often) overlooked costs associated with the purchase of a house.
First-Time Home Buyers Tax Credit
The Home Buyers Tax Credit assists first-time buyers with costs, such as legal fees, disbursements and land transfer taxes, which can be especially difficult for first-time home buyers. This $5,000 non-refundable credit provides up to $750 in federal tax relief.
RRSP Home Buyers Plan
The Home Buyers’ Plan allows you to withdraw money from your Registered Retirement Savings Plan to use towards a down payment; you can withdraw (up to) $25,000. The withdrawal doesn’t need to be included in your income on your annual income tax return – and no tax is taken off the money you withdraw.
Transfer Tax Rebates
When you buy land or an interest in land in Ontario, you pay land transfer tax. First-time homebuyers may be eligible for a refund of all or part of the tax. The maximum amount of the refund is $2,000.
Buying your first home is a big financial commitment, so it’s a great idea to take advantage of the financial options available to you. Looking for some more tips for first-time buyers? Check out our buyer’s guide here.